Albany, NY – The Race to the Top fund is part of the federal stimulus program foreducation, but the $4.3 billion dollars that will be awardednationwide are based on competitive criteria.

New York could qualify for much needed federal money if it complieswith numerous requirements for improving schools, and student andteacher performance. But, Governor David Paterson told legislativeleaders, the application has to be submitted by next Tuesday, January19th.

"This isn't like our deadlines that we go through all the time,"Paterson warned. "This is Washington's deadline, and they're notplaying."

But, one major sticking point remained, over the issue of theexpansion of charter schools. The federal guidelines say that states"can't inhibit the growth of charter schools". New York has limitedthe total of charter schools to 200, and now there are only 40 slotsleft. Governor Paterson, after initially insisting that the state'scharter school cap be lifted altogether, at the meeting withlegislative leaders conceded that he would agree to an expansion ofthe number of charter schools, perhaps to 454, or 10% of the numberof the state's public schools. Lawmakers have indicated they could beopen to what would amount to a doubling of the current cap.

But then, a new disagreement emerged, over what entity should controlthe regulation of the charter schools.

Assembly Speaker Sheldon Silver wants the State Education Departmentto have oversight over any new charter schools. Currently somecharter schools are overseen by the Education Department and othersare regulated by SUNY. Silver says if the charter schools fall underthe state education department, they can be subject to audits fromthe State Comptroller's office, and it would address some of hisAssemblymembers' concerns that the schools are not properly heldaccountable, and that their bookkeeping is too opaque.

"We believe in keeping the Regents as the monitors of education inour state," said Silver. "And having them drive this expansion."

Governor Paterson, who has been highly critical of the Senate andAssembly lately, dismissed the Education Department and the Board ofRegents as creatures of the legislature, because both houses jointlypick the Regents. The Regents then select the education commissioner.Paterson says given the legislature's track record lately, thefederal officials might then question whether any new charter schoolwill ever get built.

"Thus creating a poison pill that would destroy any effectiveness ofour application," said Paterson. "Why would we be doing that?"

Speaker Silver took offense, saying the Regents and the selectionprocess were created in the state constitution "hundreds of years"ago. Silver pointed out that the State University of New York couldalso be viewed as a gubernatorial agency, because the governorchooses the majority of the appointees to the board.

"That doesn't make them bad and that doesn't make them good," saidSilver. "It depends on who the governor is."

Senate Democratic Leader John Sampson said that some of his memberswould also like to see SUNY have a continued role, as did Republicanleaders in each house, but Sampson says the Senate will seek otherchanges that allow for greater scrutiny of the charter schools.

"We're not trying to stymie this application, governor," saidSampson. " I want $700 million dollars. I'm not going to give thatup."

Governor Paterson agreed with lawmakers that he might notideologically agree with every change that President Obama and thefederal education department is asking for, in order to win themoney. But he says the state, suffering through a financial crisis,could really use the cash, and when he sees an opportunity he's goingto take it.

"It is a day to day struggle trying to keep this state afloat," saidPaterson.

The governor and legislative leaders agreed to have their staffs workthrough the weekend to draft a bill in time to meet the federalgovernment's deadline of 4:30 pm on Tuesday.